Progress Made On Movie Plans

Dec. 3 Hearing For Metro Square Theater

MIDDLETOWN — A proposed lease and other documents paving the way for Destinta Theatres to move to Metro Square have been filed in U.S. bankruptcy court, with a Dec. 3 hearing scheduled in Hartford.

The New Jersey-based company wants to open a 12-screen movie theater in the downtown shopping center. And it wants to do so by May 1999, if possible, to tie in with the opening of the long-anticipated ``Star Wars'' prequel, ``The Phantom Menace.''

Destinta's proposal has been held up for months because the property's landlord and mortgage holders have struggled to reach an agreement about Destinta's tenancy. Now, there is a promise of progress.

``Ultimately, we came to an accord everyone can live with,'' said Thomas Boscarino, attorney for the shopping center's owner, Middletown Metro Associates. ``I expect the matter will proceed without objection and with the consent of the parties.''

Destinta's lease and other documents need the approval of a bankruptcy judge because Middletown Metro Associates filed for Chapter 11 bankruptcy protection last year. Chapter 11 of the 1978 Bankruptcy Reform Act allows a person or business to obtain protection from creditors while attempting to reorganize, rehabilitate or liquidate.

Middletown Metro filed bankruptcy to block a foreclosure action by Metro Square LLC, holder of the second and third mortgages on the property. Although the two entities remain adversaries in bankruptcy court, Boscarino said they came together over the bottom line: Whether leasing space to Destinta was in the best interest of the creditors, of which Metro Square is the big one.

``I think everyone thinks it is,'' he said.

Matthew Forstadt, attorney for Metro Square LLC, would not comment Tuesday because of pending litigation between his client and Middletown Metro Associates.

``We feel good,'' said Joseph D. Angelotti, chief operating officer of Destinta Theatres. The call from Boscarino about the Dec. 3 hearing was ``like daylight'' after months of waiting, he said.

Angelotti said Destinta has never faltered in its belief Middletown is a good place to open a 12-screen theater. But there were ``down days'' while waiting for Middletown Metro Associates and Metro Square to work things out. He said Mayor Domenique Thornton and Lawrence D. McHugh, president of the Middlesex County Chamber of Commerce, buoyed company officials and kept them committed to Middletown.

City business and political leaders were electrified when Destinta announced its intention last August to create a 1,720-seat complex at Metro Square. The $5 million plan would locate the screening rooms in vacant space once occupied by Waldbaum's Food Mart and CVS Pharmacy, as well as footage currently used by Metro Spirits.

McHugh and Thornton are both upbeat Destinta will come to Middletown.

``I've been hearing a lot of positive words about the project and I think both sides have agreed it is a terrific project,'' McHugh said.

Thornton, a former bankruptcy lawyer, said it's all up to the bankruptcy judge. But she is confident, adding that the common council will likely take up a tax abatement request from Destinta at the council's Dec. 7 meeting.

Boscarino said four motions have been filed with the bankruptcy court. They call for:

* Authorizing Middletown Metro Associates to enter into a lease with Destinta Theatres at Metro Plaza LLC, a subsidiary of sorts of Destinta Theatres. The lease would be for 10 years with seven five-year options. Rent would be $500,000 a year for the first five years, then $520,000 a year for the sixth through 10th years.

* Allowing Middletown Metro Associates to enter into an agreement with Metro Spirits to move the liquor store from its existing store into space once occupied by the state jobs center. At over 4,000 square feet, this new space would double the size of Metro Spirits.

* Settling issues pertaining to the existing lease on the old Waldbaum's space now held by A&P, the supermarket chain. A&P's lease runs to 2004 if it is not terminated.

* Entering into an access agreement with A&P to allow Destinta to enter the old Waldbaum's space to conduct tests necessary for the renovations.

Angelotti said Tuesday that Destinta is still aiming for a May opening, but he acknowledged that depends on how quickly all the pieces of the project can come together.

``Do we want to make `Star Wars'? Obviously, that would be what's driving our schedule,'' he said.